Addendum to Employment Agreement
This Addendum is for the purpose of making certain modifications and additions
to the Agreement (the "Employment Agreement") entered into between Steven F.
Kaplan and The Coleman Company, Inc. with an effective date of August 1, 1996.
Words defined in the Employment Agreement shall have the same definition when
used in this Addendum. In the event of conflict between the Employment
Agreement and this Addendum, the terms and conditions of this Addendum shall
prevail.
In view of the above, the Corporation and the Executive agree as follows:
1. With respect to the remainder of calendar year 1996 and all of
calendar year 1997, the Corporation agrees that Executive will receive
a guaranteed annual incentive equal to no less than 70% of Base
Salary, with such incentive for 1996 to be paid in February of 1997
and such incentive for 1997 to be paid in February of 1998. This
guaranteed incentive is a minimum only, and Executive shall receive
the greater of the guaranteed incentive amount or the amount
determined under the terms of the Executive Incentive Plan.
2. Executive shall be a participant in the New Coleman Company, Inc.
Retirement Plan for Salaried Employees, and in The Coleman Company,
Inc. Executive Retirement Plan, and notwithstanding the vesting
requirements of such plans, if Executive's employment with
Corporation shall terminate prior to August 1, 2001, for any reason
other than termination by the Corporation for Cause, termination by
Executive other than for Good Reason, or the death or disability of
the Executive, then Executive shall be entitled to receive from
Corporation a guaranteed retirement benefit under the provisions of
such plans equivalent to that which would result from five years of
credited/vested service based on Executive's Base Salary and Target
Bonus as if paid over the full five year period. This provision for
special retirement benefits shall not result in a stacking of benefits
and shall be without further force and effect upon Executive achieving
five years of credited/vested service under the terms of the New
Coleman Company, Inc. Retirement Plan for Salaried Employees.
3. As an alternative to the provisions for compensation upon termination
by the Corporation without Cause or by the Executive for Good Reason
as contained in Section 6(c)(3) of the Employment Agreement, and
having application only following a Change of Control, Executive shall
be eligible to receive special severance payments, to be made on the
following basis. In the event a Change of Control of the Corporation
occurs within the first eighteen months of Executive's employment with
the Corporation, and the Executive's employment is then terminated
within one year of such Change of Control (other than by the
Corporation for Cause, by Executive other than for Good Reason, or by
the death or disability of the Executive) then Executive shall be
entitled to receive from
Corporation a severance payment equal to three years of Executive's
Base Salary and Target Bonus, to be paid in a lump sum at the time
of termination. In the event a Change of Control of the Corporation
occurs within the second eighteen months of Executive's employment
with the Corporation, and the Executive's employment is then
terminated within one year of such Change of Control (other than by
the Corporation for Cause, by Executive other than for Good Reason,
or the death or disability of the Executive) then Executive shall be
entitled to receive from Corporation a severance payment equal to
two years of Executive's Base Salary and Target Bonus, to be paid in
a lump sum at the time of termination. This provision for special
severance benefits shall not result in a stacking of benefits and
shall be without further force and effect upon the later of August
1, 1999, or the first anniversary of a Change of Control occurring
prior to August 1, l999.
4. Executive shall receive a signing bonus of $100,000 to be paid in two
equal installments. The first payment of $50,000 will be made within
10 days of the date Executive begins employment with the Corporation.
The second payment will be made on the first anniversary of
Executive's employment with the Corporation and is contingent on
Executive being actively employed by the Corporation as of the
payment date (unless Executive's employment is terminated by the
Corporation without cause or by Executive for Good Reason prior to
that date, in which event the second payment would be due on the date
of Executive's termination.)
5. Executive will receive upon commencing employment with the
Corporation, an initial stock option grant of 100,000 shares, with the
grant to be made at market price on the grant date. The option shares
to be granted will vest in 33.33% increments at the end of years 3, 4,
and 5 following the grant date, and shall have an overall term of ten
years. Grants are made by the Compensation Committee of the Board of
Directors of the Corporation, and the grant process will be initiated
on the Executive's start date. Executive will also be eligible to
participate on the same basis as other similarly situated executive
employees of the Corporation in the 1996 stock option grant which is
expected to occur in October of 1996.
6. The Corporation will waive all waiting periods with respect to
commencement of participation by Executive in health, dental, and
disability insurance plans.
7. The Corporation will retain the services of a third party relocation
firm to assist in the relocation of Executive's family to the Denver
metropolitan area. The services to be provided will include an
appraisal based purchase and/or equity advance on Executive's current
residence. The Corporation will pay all reasonable expenses incurred
by Executive in such relocation in accordance with its normal
relocation policy. As a part of the relocation, Corporation will pay
the cost of providing suitable temporary housing for Executive in the
Denver metropolitan area and will also reimburse Executive reasonable
travel costs incurred by Executive and by
Executive's spouse and children for travel between Boston and Denver
during the time prior to the permanent relocation of Executive's
principle residence. It is agreed between Executive and Corporation
that such permanent relocation will be concluded no later than June
30, 1997. In the event any reimbursement of relocation expenses by
the Corporation is taxable to the Executive, then the Corporation
will "gross up" such reimbursements as required to offset such taxes.
8. In the event Executive's employment by Corporation is terminated at
any time within the first 36 months from Executive's start date, but
excluding termination of the Executive by the Corporation for Cause,
or termination by the Executive other than for Good Reason, then the
Corporation will pay the reasonable costs incurred by Executive in
relocating the Executive's primary residence from the Denver
metropolitan area to the Boston, Massachusetts metropolitan area
(consistent with the Corporation's reimbursement of Executive's costs
to relocate to the Denver metropolitan area).
9. The Corporation has been advised by Executive that Executive currently
serves as a Director of two companies, neither of which is a
competitor of the Corporation or its affiliates. The Corporation
consents to the continuation by Executive of such board service and
agrees to look favorably on other board service by Executive so long
as the time required will not unreasonably interfere with Executive's
responsibilities to the Corporation, and that any such board service
is approved in advance by the Chief Executive Officer of the
Corporation.
IN WITNESS WHEREOF, the parties have executed this Addendum as of the date
below.
THE COLEMAN COMPANY, INC.
By: Michael N. Hammes
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Date: August 3, 1996
Steven F. Kaplan
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Executive
Date: August 3, 1996